@_nirajshah @unseenvalue @AdityaKhemka5 @bqprime Question on the API Space:-
If these companies cannot maintain their margins in a volatile environment. Why should these be given a high valuation? Isn't the fragility too much and on supply side too many DMF filers?
If these companies cannot maintain their margins in a volatile environment. Why should these be given a high valuation? Isn't the fragility too much and on supply side too many DMF filers?
@_nirajshah @unseenvalue @AdityaKhemka5 @bqprime When the end formulators are going through pricing erosion. What gives an API co the right to make more than 16-18% Ebitda margins when your end customer is suffering?
@_nirajshah @unseenvalue @AdityaKhemka5 @bqprime Even companies like Divis Labs have suffered from Pricing erosion (25% Pricing cut) in their generics division. How to assess other companies when a co which is dominating the supply side going through such problems? Any framework for the same?
@_nirajshah @unseenvalue @AdityaKhemka5 @bqprime Between Domestic Pharma and Hospitals. Which one will you classify as a more inflation proof business? Domestic Pharma gets NLEM pricing revision when prices increase. Though API prices also rise, in Hospitals. None apart from Apollo have reported margin compression
@_nirajshah @unseenvalue @AdityaKhemka5 @bqprime When it comes to injectables. What is the detailed anti thesis about the large listed injectables company. They guide for sustaining margins between 35-37% and given past regulatory actions against Pharma co's trying to get into injectables.Doesn't it ensure sustainable earnings?
@_nirajshah @unseenvalue @AdityaKhemka5 @bqprime India is still 70% dependent on Chinese companies for API Raw Material (including KSM's and Intermediates). How and in which spaces or particular therapy areas do you see this dependence reducing? Why will it reduce given Chinese companies have built economies of scale?
@_nirajshah @unseenvalue @AdityaKhemka5 @bqprime Thank you so much @_nirajshah for this opportunity to ask questions. Have been absorbing knowledge from the three pharma gurus @punitbansal14 @unseenvalue @AdityaKhemka5 ever gratefulππππ
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